District auditor gives clean regulatory-basis opinion and urges procurement policy improvements

Russell Shipley, the district's external auditor, presented the 06/30/2025 audit and related findings. He reported an unmodified opinion on the regulatory basis of accounting (the district's standard reporting basis) and noted a standard adverse GAAP opinion that many Kansas municipalities receive when they use the regulatory basis. He emphasized there were no federal single-audit findings and no matters reported on the financial statement or single-audit side.

Shipley flagged a small negative balance in the grants fund at year end ($118), explained as a timing issue since many grants are reimbursement-based, and noted some budget-to-actual entries where grant and capital outlay spending exceeded the adopted budget because additional funds were received during the year. He recommended the district strengthen procurement and bidding documentation, consider a conflict-of-interest policy for board and staff, and improve documentation to make audit responses timelier and more centralized.

Board members asked clarifying questions about the adverse GAAP opinion and whether the negative grant balance indicated a cash problem; Shipley said the regulatory-basis opinion is clean and most concerns cited are typical for grant reimbursement timing and budget amendment practices.